Abstract

The demand ofLPG (liquifred petroleum gas) in Central Java relatively low than other provinces in Java Island. Meanwhile, the comparative ratio of L1 consumption to population number in Semarang is found not to be the highest
Central Java, whereas Semarang has the highest level of LPG consumption Central Java with larger number ofpopulation. So, this research aims to analyze th demand ofLPG by household in Semarang and thefactors that influence the demadc of LPG.
This research use survey methods by means of interviewing the consumer of LPG based on available questionnaire that consists ofquestions about LPG demand. Afterwards, all data gathered : LPG demand, LPG price, total earning per family,
electricity bill, education level of decision maker of LPG usage, number offamily members and the choice of packing size are analyzed using multiple regression analysis which estimated using ordinary least squares method.
Research result shows that LPG price is the most important variable that influences LPG demand was depicted by high elasticity value ofprice. While packing size shows that it is not significant variable which means there is no difference between the demand of12 kilos LPG and 3 kilos LPG. Then, the result show earnings variable influence LPG demands significantly, it show that LPG is primary goods
that depicted by inelastic elasticity of earnings. Afterwards, significant result is showed by electricity bill variable so it can be concluded that electricity constitutes substitute goods for LPG. Last, education level and number offamily members' variable signficantly influence LPG demands.
Keywords: LPG demand, LPG price, electricity bill, education level, number of family members, packing size, price elasticity, earnings elasticity, substitute goods